Why does how we invest matter?

The companies we invest in make their money from activities like selling consumer goods, healthcare or key technologies. As we explain on our 'Where does my pension go' page, the idea is that as companies grow, so too does the value of your pension.

We also think about what the companies are doing in the real world and how they are doing it. We ask things like:

  • are they fair?
  • are they prudent?
  • do they look after the environment and the communities they serve and operate in?

All of this is as important as the returns. In fact, we believe that how companies manage these big issues actually affects the returns they make.

So what they do with the money they receive from pension investors like you, through pension companies like Royal London, can make a big difference on behalf of all of us, to the future of the world.

That’s why as a pension company acting in your best interests and in the best interests of society, our job is to make sure these companies are behaving as responsibly as possible, in every way.

Where we invest

In the table in the next section, you can see the type of companies your pension is invested in.

These are the top ten investments in the Royal London workplace ‘default’ pension fund, which 80% of our workplace pension customers are invested in. Default just means the fund selection that is automatically allocated.

You might recognise some of the names - they might even be companies you buy from.

Last updated

The information in this table was accurate and correct on 31 December 2020.

The top 10 companies in the Royal London default pension fund

Company What it does
Apple Technology
Microsoft Technology and computing software
Shell Oil, exploration and energy
Amazon.com Online retail
Astrazeneca Pharmaceuticals
Unilever Consumer goods
Taiwan Semiconductor Manufacturing Manufacturing
Alphabet Google holding company
Rio Tinto Mining

 

How do you make my money responsible?

So that we can meet our commitment to responsible investing, we ask our asset managers to 'vote' at Annual General Meetings (AGMs) and also ‘engage’ with the companies you invest in through your pension.

This involves discussing, questioning and helping to shape their policies on real world issues - things like CO2 emissions, global poverty or executive pay.

As shareholders who own stakes in companies, we can state the case for change if we believe it is necessary and in the interests of pension customers as well as the wider world.

Sometimes changes to multi-billion pound companies can take time and can have significant implications, so we try to take a big picture view.

Because of this ability of shareholders to prompt change at big companies, your pension is actually powerful.

Below are some of the issues we engage with companies on:

  • Environmental, ie. CO2 emissions, plastics
  • Social, ie. modern slavery, housing
  • Governance, ie. executive pay, tax

Responsible investment in action

Learn how the Responsible Investment team at Royal London Asset Management (RLAM) engages with the companies they invest in on our behalf.